In its maiden earnings report as an independent concern, Time Warner Cable ( TWC) reported stronger-than-expected profits, helping lift its stock 14% in afternoon trading Wednesday. The nation's second-largest cable company, spun off from parent Time Warner ( TWX) in March, said it registered earnings of $164 million, or 48 cents a share, which included one-time charges for spin-off costs and other items totaling $92 million, or 27 cents a share. Backing out those items, the company's EPS was 75 cents, topping analysts' expectations of 61 cents a share. In the year-ago period, Time Warner Cable said it earned $242 million, or 74 cents a share. First-quarter revenue increased 5% to $4.36 billion from $4.2 billion last year. Driving those strong results, the company said, were increases in subscription revenue of 6% to $4.2 billion as the company added 225,000 new customers during the quarter, many of whom were antenna users who signed on to the cable service in advance of the national standard's switch to digital in June. The company also benefited from cost reductions, including those associated with 1,250 layoffs. Investors were made hopeful by Time Warner Cable's results since the company exceeded estimates in the teeth of a deep recession, analysts said. The company's shares had jumped 13% by Wednesday afternoon, trading at $31.09 on heavy volume. The news from the freshly independent concern spurred other cable stocks into the black: Shares of Comcast ( CMCSA), Viacom ( VIA-B) and British Sky Broadcasting ( BSY) were all up by at least 7% on the day, while Liberty Entertainment ( LMDIA) had climbed 4.3%.
The company's former parent also reported results that beat Wall Street targets Wednesday and announced plans for another big spin-off, this one of AOL.